New law blocks lawsuits against oil, gas sectors in Louisiana

The oil industry has gotten a controversial added boost after Gov. Bobby Jindal of Louisiana signed a new law which will block many lawsuits in the already powerful sector.

Jindal signed the bill on Friday that will apparently stop the 2013 lawsuit filed by a flood protection agency – called the Southeast Louisiana Flood Protection Authority-East – and will stop other government offices in Louisiana from filing similar lawsuits.

The state’s attorney general, James D. “Buddy” Caldwell, and close to 100 legal specialists warned the new law is too general, and could even block litigation against BP in connection with the 2010 Gulf of Mexico oil spill.

But Jindal says litigation, such as the one by the flood protection agency is “frivolous." He adds the new law will reduce the number of “unnecessary claims that burden businesses so that we can bring even more jobs to our state.”

Not suprisingly, the Louisiana Oil and Gas Association supports the new law. “The passing of this piece of legislation represents the idea that greed will not trump hard work and determination,” Don Briggs, the association’s president, said in a statement quoted by the LA Times. He also was quoted by the New Orleans Times-Picayune saying, "the signing of SB 469 is a huge victory for the oil and gas industry as well as the economy for the state of Louisiana. While there is still much work to be done, this piece of legislation is a big step in the right direction."

The flood protection board could still sue the state to block the new law. John Barry, a former member of the flood protection board, told the LA Times, “The attorney general, the president of Jefferson Parish, the New Orleans City Council and others all called upon the governor to veto the bill. I think he signed it today because they were just the beginning of a broad chorus from around the state and he wanted to cut that off before that chorus became deafening.”

Local governments may be hampered in their efforts to collect damages because of the new law. Yet, the governor's executive counsel, Thomas Enright, claims the new law would not prevent claims against BP.

Texas, Alabama, Louisiana, Mississippi and Florida have sued BP for its role in the 2010 Deepwater Horizon oil spill, InsideCounselreported.

The flood board lawsuit attempted to get energy companies to “either fix damage caused by dredging canals and pipeline channels and other actions, or pay the authority for damages that can't be restored,” according to a report from the Times-Picayune.

Still, despite the opposition, Jindal supports the new law. "This bill will help stop frivolous lawsuits and create a more fair and predictable legal environment, and I am proud to sign it into law," Jindal said in a statement last week.